it's in our best business interest to maintain the integrity of customers, networks, and their subscribers data, period. we are not going commit commercialed is by violating that integrity. >> if you receive a legal wander you have go the same thing that verizon, at&t. it's an important point there's not a country in the world that doesn't have lawful intercept. meaning they have their own jurisdiction and in our country under president clinton we passed -- a communications assistance to law enforcement act. and we collectively as taxpayers gave a sub sky -- sub sky to the companies to pay for the hardware and software

that allows phone taps to take place. you cannot have unreasonable searches but you have reasonable searches. just like if you watch the sopranos we, do, in fact, tap the phone of suspected mafia dons inside our own country. so we can't be hypocritical. intil right. we can't be hypocritical of the chinese for enforcing their own. i think the key question that is being put on the table the question is in fact certain what are proported to be private enterprises are in fact tools of the foreign government for the purpose of espionage. i'm not here to suggest whether in fact huawei is or is not. they're doing us a favor in one

respect. you remember, i remember back when we were worried about the threat from the japanese against the -- when they bought rockefeller center down the street and everyone thought the world was coming to an end. one of the great things i remember from one of my professors at columbia was, you know, if we didn't have the japanese we should have invented them. they made us better. they made us more competitive. and the wide reaction of the japanese wasn't protectionism, it was learning to be have a more competitive auto industry. learning to be -- >> i think may actually to talk about situations that are hypothetical than the case -- i think it's not very productive. perhaps the a-- let consider china for a moment. we have an interesting case that flips on the questions that you are questioning. that is microsoft in china. we know that microsoft is

cooperating with the chinese government. they have provided various forms of help to the chinese security establishment in order to, for instance, listen and to skype conversations. it's well known that the chinese government is good at intercepting special key words on social media. it was american products. the government that is able to get help from an american company highly different context. the only pressure point is not the legal. not a legal one. purely commercial. it raises fundamental ethical questions that i'm sure. ethical questions that are the flip side of what you are mentioning. if it has real consequences potentially for the individual. these are concrete questions

that really can mean interrogated. people have suffered a personal consequences. this is not very theoretical. we're screaming here. it's an example of what i mean. and we have a hypothetical discussion about how somebody could use. >> pursue with you. because -- didn't have to deal with big data. okay. so if he was alive today, and he came back and he looked at modern warfare, i suspect having suffered through the thousand pages he would be fascinated by the concept of information war. which is to say you have conflict between states that is an extension of politics by other means without blowing things up. without sending 100,000 troops in. and you can do it by manipulate

as one of the categories you had. or that you could begin to affect infrastructure. you wanted a concrete case. a fascinating chinese-based concrete case is the canadian offshoot a company that controls all of the -- not all of. about 60% of the gas pipeline that works in the united states and down from mexico. so they come in to work one day about a year ago, and they discovered that all of their source code has been taken. they conclude that the taken by a chinese origin thief government or nongovernmental. one way to look at it is that all that was stolen was the software to know how to turn on and off the valve of the gas pipeline. the other way to look at it if you were in a cron --

conflict with the united states, it night be useful to have the coding to turn off the gas to 60% of the country. where does is fit to the spectrum? >> so in your -- the word cyber weapons is often used in the context. developing code to inexat at a time critical infrastructure. you also use the ebbs presentation in your book. let quickly think about what it means. what are cyber weapons. what the potential of such weaponized code and limitations. let imagine for a moment. the only real big example we have and can discuss in detail. nanl as a --

you would not have noised. because stock net of pro sizely developed for those industrial control systems that messaged. a company. and these are highly specific systems. for many reason. they offer old so called legacy systems. some gear in rick components. it only affected machines incon qecial. it was one shot. that means and one of the arguments that i'm testing in the book and i interviewed many control engineers on that question is by maximizing the destructive impact of such a tactical you automatically --

minimizing the target. that's a tough question to answer. in other words, can you exchange the of it by using some of the generic components and applying it. t a controversial question among the engineers. it's unclear. >> it takes us up with of the questions by e-mail which is along these lines. ann in brooklyn, i feel like, you know, i feel like we're doing an advice column here. it if the u wanted to conduct a cyberattack against the shanghai military site where the chinese are allegedly carrying out their cyberattacks. she's -- we wrote about it earlier this year. could we do so? could we do it technically and politically? >> now which is a chinese

military unit believed responsible for a number of the attack open u.s. computer systems. but mostly for the theft of intellectual property, some state secrets, airplane design, thing like that. chad, this is right down your ally from dhs days. could we do it technically and do it politically? >> we're off the record; right? >> right. that's why the cameras are running. go ahead. >> so i guess -- >> i can't say whether the united states government has capability. but one might surmise you can take down nuclear center fiewjs as as mentioned in a specific location in iran, you probably could, in fact, target a specific building in shanghai and specific actors. >> to achieve --

>> and thing this case -- >> the objective point. it's a good question. >> to do what? >> to any -- any military doctrine you have what is called a atry biewtion and retribution. if we think back in the cold war. it was at the heart of mutual destruction. it kept us relatively safe over one of the most threatening periods in global history. the world could have been annihilated overnight with an exchange of soviet union and united states weapons. cyber is in fact, the definition used about the last requirement for a war is claiming responsibility. part of the appeal of this particular weapon is its lack of

ability to attribute who did. it atry biewtion in this threat vector is unbelievely complicated. to actually penetrate the multiple layers. i'm speaking now personally because of, you know, -- david didn't get the story. "the washington post beat him to the scoop. but it happens. we were one of the 140 plus companies there were jut lined in kevin's report under what is called -- we were we successfully detected it and stopped it. we never got penetrated. but the point is that this is a very real threat. it's happening if we attempted

to extract retribution this is something we need to talk about you're right it would have been aprilly extremely difficult. it it the united did if we would have to attribute that directly to the chinese. what we're seeing right now the tremendous skepticism that is being ask by the american people and barack obama about weapons of mass destruction in syria. there's suspicious about is the evidence strong enough to warrant the limited strike on syria. i would argue you would find it to be even more difficult. more difficult for president obama to put forth before the people of this country a similar proposition he just put forward on chemical weapons which are frankly more visible. there's more ability to actually produce victims and symptoms and

signatures you can -- this is why a modern doctrine for the threat is so needed. i think he has done a good service by putting forward and tom don lane who came here. we need a new version of mutual assured destruction for the cyber age. so they can operate more momly -- anonymously. focus on china as much as this conversation has.

so let me first interject that cyber conflict, cyber mischief, cyber what have you is borderless there are states and demonstrates. and whether the u.s. is hacking china or china hacking the u.s. or russia hacking both or israel hacking everyone. this is all taking place. we cannot look at the threats to networking security and data integrity and the context of one country in another country and those countries versus each oh. so what can be done is there such a thing as a perfectly secure networking? no. there never will be. we can make them more secured. and there are grossly speaking there are three different domains. there's what i do on the equipment side and the coding of the equipment side.

and everything we build that any huawei or cicso or other is built to global standards. our customers, operators, want to be able to have a competitive environment. they can -- i'll take a this from him and rationalize the market prices. they keep us honest. that means what we intild intend -- build is intended essentially interoperateble. when you drop the equipment to the networking, if you have not raised the security bar for in term for -- you accomplish nothing. how can we find and develop in a public-private partnership standards to raise the bar of the equipment that company like ours deliver? the second in the realm of service providers and data

management. it's apparent over the last couple of months what we need in the space is more transparent regulation and environment better geared to protecting the integrity of data. and the sthird the one that chad was speaking about. that's government. i would like to believe, i would like to believe that using l -- when two adversary came together in the '60s and recognized they could blow each other up umm teen decides an -- i'm almost done. who are we vulnerable to? so you nuclear nonproliferation treaty and the lowest common dmonl nateer. it didn't stop it but it slowed it. if they can agree on acceptable behavior, it won't stop

espionage but may restrict disruption or potential disruption. that can be multilaterallize. >> i think it would be useful to keep this a little more grounded. first that should be obvious i think is not. computer code can only effect computer code. in other words, as i'm sitting here on the podium. it applies to the rest of you. we are invulnerable to computer -- i do not have a pace make are with an ip address. [laughter] it's very important. could the united states attack that particular headquarter building in shanghai? the answer is it could certainly breach the information system. that is not probably not too difficult to do if it has an internet connection, et. cetera.

you can weaponize and turn in to something. in syria and others quite difficult. let think about that when we admire the trorngs on our new car. let's go to thed audience for the first question. here, sir. one moment. there's a mic coming your way. tell us who you are. and please ask a question. >> hello? yep, you're working. a fellow at georgetown. what are the options attribution or nonattribution. as a commercial entity what -- more importantly receiving

remediation for the physical attack of a country or another what are your -- well, okay. the question is one about escalation so there's an attack. you perceive an attack on the company in the united states. who attacks back? tell me if i'm right here. the company that is attacked? do they have a right to attack back? should a government attack back on their behalf? can we only play defense? tom? >> that's a big debate. whether hacking back is works. so i think there are two questions when we talk about hacking back. one is that it allows legal -- is it legal? the other is it deliver results? let ignore that for a moment. i had the conversation with a couple of companieslet not name them here.

i have yet to see the -- the evidence it delivers results? only example we have in the public domain is somebody hacking back is quite a funny one. it happened in georgia. three years ago where somebody apparently from russia hacked the georgia ministry and try to exfiltrate the document. and the computer emergency response team in georgia found out something was fishy and they actually put a pdf fire rigged had malware embedded and something fancy like nato agreement. so the russian hacker apparently stepped to the trap and hacked him and took a video of the guy and picture with his web cam. it's a guy sitting there and his

wife in -- >> if anybody hasn't seen the photograph. go home tonight and dig it up. it's exactly what you think it would be. [laughter] but it's an interesting point. it didn't solve the attribution problem. they didn't know who it was. they had no idea who of it. >> okay. chad, back in your days in dhs let's say company x got attacked. they call you up and say, i know my government. they are not going attack back on my behalf. because they don't want to escalate to a general cyber war. do you have any problem if we think we know who attacked us if we blow up their servers? >> well, it's a fair question and we -- when we got asked that. now that i'm out i'm being asked. the analogy i would use, if we think about a bank; right. if somebody walks in to a bank

with a weapon, tries to take the money, and going out the door there's well established precedent that a private security and armed private security forward legally can in fact order the individual to stop and if they refuse to cease and desist. they can, in fact, use lethal force. for whatever reason in the digital world we don't allow that. what you're seeing across the commercial environment from my clients is what dave describe is an unbelievable feeling of being left hanging out to dry by your own government. what is happening is as we sit here in the society we're starting to see historically the business community like the chamber of commerce. ..

>> not only is the active defense allow for a change of behavior, the reason why we think about it logically is because so many targets were people don't respond that we have someone that just does the low-level acts of defense, they move onto the next soft target. >> let me cut you off because we

don't want to speak too long. this is uncharted territory. we need the legal framework because in the absence of that, people are getting frustrated. >> so now we can all feel your pain. one of those themes where your company has been attacked, you think it's whether it's chinese government or chinese teenagers ordered chinese criminal groups or whatever. and i just installed the latest and greatest huawei servers. and i will be asking the question. is the attack from abroad? or perhaps unknown to us, i sort of help to the seat come into my system? >> i have thought the same that you have about the increasing

attacks on the u.s. networks. and we have less than 1% of the u.s. network market. the attacks are not taking place in this way. for what it is worth. >> okay. that is a good answer. >> the microphone is coming to your. >> thank you. >> we have been hearing for a long time now the danger of cyberattacks on national security, and we have been talking about the corporate grounds for the most part. where do you see this going? and is this realistic? when will it happen and what can we do about it? >> okay, you said academics don't look in the future. so look into the future. [laughter] >> the biggest problem is

espionage and disrupting systems and where is this going in the future? well, that is a great question. do let me go to the edwards noted revelation for a moment and that they part of the picture. the u.s. government, the nsa is beyond capable than they intercept more data and more information than many people previously assumed. i think one of the big questions of the future what does that mean? what does it mean for intelligence? what does it mean for the balance between western

intelligence agencies in other countries. and i understand that we are very concerned about what is going on at the moment and some of these revelations have a point to intercept. because we have an informed debate about what is going on and we should be able to do it. but right now what i am seeing is a difference and in fact, we are not having a conversation about what is okay to do and what is not okay to do. it's a very moral and ethical case to be made for an open democracy and after our we are an open democracy, which has to be part of this because many people think that that is not the case.

and we are not part of the case to be made should be a part of the democracy. we want this process because after all, this is a very important global concept and there is justification for this and we need to have that. >> and i know that i have a request to be less crowded, so i will be in just a moment. but we are also seeing as a result of this crisis, we read in the media the brazil is looking to launch a geo-satellite and the indian government is contemplating the

elimination of gmail and yahoo for government employees in germany is looking to localize crowds and they have launched an e-mail in germany that is safe from the nsa. we are seeing this fracturing of the internet environment which is not good for anyone and in the short term, there will be business opportunities. but in the long-term, the internet activities, we are reacting and vulcanize them. and that is not solving the problem and what that is is creating a challenge to steal and interoperability challenges and the spread of open information than what we need is to balance out that in all of the economic benefits associated with that with the need for real pragmatic approaches to better secure our networks. so it takes us is right to question that we have gotten by e-mail from an anonymous individual. not the group, but someone who

doesn't want attribution to the question. and as by e-mail, do you think that there is a need for a cyberweapons convention, much like the ncp, which is the nuclear nonproliferation treatment. and who should govern it and is there an interest. every time i asked someone, someone in the u.s. government, they flee in the other direction. but then again, for the fifth on transfers 15 years after the atomic bomb was developed, we didn't want to see an atomic bomb unit. so i don't want to get off topic. please tell us what works here in the analogy and what doesn't. is it even possible to have a treaty with a weapon that is not in the hands of the state,

teenagers acting like terrorists, terrorists, whatever. and i believe this to chat. but what i said earlier is the industry needs to do its best, which means that those of us that do this need to, all of us, be held to the same standards. and that means that we need to establish the best practices and disciplines that will then be certifiable to all of us, that service providers and data managers as well, the best disciplined environment as well is legal and regulatory regimes and the concepts of this entity for cyberis in the third realm and that is where government needs to work out their issues and those issues may be as simple as i won't crash your markets if you don't crash my planes. but they need to do that in the context of allowing industry to move forward commercially and

competitively to continue to innovate. but the reasoning in the nuclear realm is first the weapons were all in the hands of state and secondly, when one of them got walloped, it was this neat little screening that was down in some mountain in colorado that you would see in all the movies and he would see that you would have 30 minutes before you were annihilated. this screams for cyberweapons, you don't know whether or not an attack is coming, whether it's from this state or an individual or where it is coming from. so how do you make this work? >> it is exactly this challenge,

which is the suspect is fundamentally decentralized and dynamics and 30 minutes is an eternity. you have 30 minutes to respond in a long time, believe it or not. this is happening at the speed of light. thousands of attacks per second and what it means is that the old paradigm from the nuclear age of essentially having a command and control sector where there are two people in the united states to have the launch code, and the commander of norad that have the launch code, that have this syndication and a very exercise method of responding, that hierarchy is antithetical to this threat. this threat is decentralized. and we have a situation where thousands of attacks are happening per second and there's

no way the president of the united states can sit there and say, it's like me coming up and saying, do we have this, what he wanted to do in this and that. and what we have to do is actually look at the threats and realize that human talent is not dominated by the united states and the weapons are not dominated by any particular government and the command-and-control is not dominated and there's no thing that comes up with this clear ability to decentralized the dynamic response of government, decentralizing this in regards to the first few words. >> okay, so the nuclear analogy drive you up the wall. >> yes the attack code, if you want to call it that. without hundreds of thousands of attacks per day.

and it is a specific targets scam. there has only been one that we can take seriously in that way and i think no one would be able to do that. but almost all of these breaches this microphone or camera, they are not having any difference in this. so i think that's a very important qualification and it's not happening at the speed of light is out in the wild with these versions in 2007 and then what would become is discovered and this is the most sophisticated that we have. so we need to take some of this letter happening at the speed of

light. >> and it took like a year and a half to figure it out. >> exactly. and that is an important point. the surgical stride by a state-sponsored actor is a section of sophistication and i agree that they will happen less frequently. but within that, you start to look at the commercial espionage realm and that is the bulk of this. in that realm, what we need to think about is the governments are inherently not dynamic or decentralized and therefore, they are not the right answer. the right answer to the problem is let's get the standard items norms of behavior and empower

the private sector who has decentralized the dynamics to deal with this, much like the analogy where i grew up in texas, you have a local police force and the nypd and you don't always need a big government solution. and frankly, in this case, going back to the bank analogy, having a private solution, responding as long as they meet the certification in the standards, government doesn't have to solve all of our problems and we can in fact solve it ourselves, that high-end dedicated attack is the realm of state-sponsored government and you heard general alexander say and he got in trouble for that we don't even have our act together or the

cybercommand that has just now announced that they will have this and that they won't be ready until 2016. that the calvary is not coming, we are on our own and we have to have a global consensus and then in power with cyberpolice forces at the head of the problem. >> chat makes a great point. while organizing the office of cyberteams, somebody did strike this at the olympic games. they may not have been organized as a team, but they had to operate someplace. so the gentleman with his hand up there, a microphone is coming to you. >> hello, i am from policy in focus and there's an aspect that you have talked about, we have seen how vulnerable the world system is too chaotic behavior and so just how formidable are

those systems because you mentioned the speed of light. it seems that most of our financial system now is being run by computer programs and just how much chaos -- we have seen how much can be caused by a malfunctioning system. so, you know, could this be deliberate in the chaos theory? >> i think the question here is we have seen markets that know how to implode on themselves and we have seen nasdaq shutdown without any outside help and supposing someone came around and actually -- i think it raises an interesting question, but i think it raises another question for you, which is we couldn't have imagined a world that was this interdependent. but yet you can pick out a bunch

of societies all at one time if necessary. and we really do that ourselves with lehman brothers and bear stearns five years ago. tell us about the vulnerability of someone was trying to do a deliberately. >> there's no doubt. there have been a few instances over the past couple of months that some of you may remember. with a twitter account was hacked and as a result, they said that the president had been tried out in something like that and i have a market effect immediately. but only for a few minutes. >> people can make a lot of money in a few minutes in this town. >> that is right. but it bounced back very quickly. that's an interesting situation. there's a lot of people that got

a call there in the washington dc area about this. in just a quick point. what does it mean? if we look at science, it's an interesting pattern that we are getting used to. we are not really in denial itself, but we are just taking it down for a couple of hours. but you asked them in the major banks are worried. it is costing them millions of dollars per minute and with others, what we have seen is the shift from self-destruction and what is going on against wells fargo, bank of america, citibank, each of the attacks to steal money or intellectual property, these are direct attacks specifically for this, which is shaking the confidence

of our system and you'd think about it on any given day, all of it, going to the bank, tomorrow to take out money, no bank can withstand that. so it's a great question and that is politics by another means, an act of war. >> if there's no more questions, we will go to one more here. and i'm not a mother that we don't know if it's the same or a different anonymous, a question. if the only problem here is that your company has a chinese name, cisco has been known to help china build its firewalls. and have you thought about changing her name to something else? >> to the first part of the

question, i think that the balance of the challenge that we have faced because we have a heritage in china, it is stunning to me at times to explain to someone that it's a 35 billion-dollar company and trusted globally and up to $35 billion, one third of all the huawei gear comes from american suppliers, at like $7 billion worth of procurement last year and is stunning to many. but people cannot grasp that. so yes, a great deal of this is a fundamental misunderstanding of what it means to be an international company with this heritage. if you read the senate report and so forth. it has links to the chinese

military and where the founders of the company have talked. >> that's hogwash. and you know, i thought that that might come up, and i thought about bringing in something about this tall, a 20 page report, with every bit of information, but i didn't want us to be distracted. and no, it is a fundamental part of the asia society and that is part of what we are here to do, to increase understanding of an area across different cultures and there's a fundamental misunderstanding of what it means to be a multinational with a heritage in china. and let me ask you the reverse question. was there any similar concerns in time that you are aware of that they were buying into the

system to which you were a part of? >> i mean, i cannot speak for the concerns on that side, but you also have to keep in mind that the terminal, whether it is a pc or tablet or phone or what have you, it has not attracted the same attention as the access to the network in the corner. >> okay. >> and if you think about the name, say toyota, my grandmother used to buy japanese cars and imagine some of your parents today, i think we view toyota is a trusted brand with multiple individuals across the united states, and part of our closest allies are in japan. what is fascinating about that analogy is we did have to look at forcing the japanese to comply with rules and other

things. >> yes, we even rented a toyota, and we got a lawyer to break down the whole car, we assembled it and we didn't have to buy it but the point began to get into compliance and play by the global rules and now they are a trusted partner with it. >> certainly what the cia was doing with the federal trade commission with this. >> was part of the economic research with the cia. it was very sophisticated. >> will be interesting if you could see the cia parking lot. [laughter] okay, very good. [inaudible conversations] >> hello, i run a company specializing in negotiation and i would like to talk about the ip backside and recently we have

engaged in a chinese entity regarding access of american technology and the american company got no satisfaction in the chinese court system and the chinese company i.t. export the same technology where they did run into legal trouble than it was the fbi that was being sued but it's a multimillion dollar lawsuit against the chinese. does that offer any sort of optimism or glimmer of hope that there may be a market or a legal way of addressing cyberespionage >> who would like to take that? >> it is a subsidiary of this,

which is essentially being bribed and the good old-fashioned way to deliver information to chinese companies. so it's not a case of espionage, it is actually a very important human element. because of that. >> are you talking about american superconductors? >> that is a different case. that is a case that involves a wind turbine technology. so i think the fundamental point of your question as was said earlier, if we can work together to raise global standards and legal standards, the chinese have an equal interest in making sure that ultimately because they are going to have this intellectual property that needs to be protected and enforced, but that type of regime is

critical in their groups like harvard and wharton that are working hard to promote the chinese leadership and how critical this type of a legal more minutes. >> and when a company like this becomes a global leader, with one of the world's largest intellectual rights property holders, that helps you drive a broader and a more global respect for the protection of intellectual property rights. >> okay, we're down to our last two minutes. while the asia society does not endorse cyberwarfare, they said that if i do run over the time. , they would wipe my iphone clean before i leave the state. [laughter] 's we will end with a question from austria. to assess, isn't the use of

cyberwarfare dislike using special operations and a tool of the trade? let me expand on the question. there was a time in the 1950s when dwight eisenhower publicly said that nuclear weapons were another problem and over time we have decided, or he decided, quietly. but it really wasn't just a tool of the trade, but because it was so uncontrollable he would not use it. so what happens when we asked that same question in all that was laid out at the beginning for us? with espionage, with attacks on infrastructure with a political tool. can you imagine a situation

where we all agree to take sides outside of our arsenal? >> i'm not sure. we are engaged and i think that this is a better question for both the academic and others. >> you're caught in the crossfire in a very good point. we are visiting unfairly in the crossfire. >> we can't imagine someone deliberately using this kind of tool. so what would really be worse in dealing with this case? >> the israelis did on their way

to redecorate the syrian reactor in 2007. >> the outgoing secretary has made a suggestion to introduce this. a huge compilation and an outcry among the veterans. people that are just, you know, playing or tapping code, they should get a medal that is higher than the purple heart and chuck hagel is a veteran himself. so the point is that it is a means to talk about this, which they are doing and we have to respect the people who are experiencing mass. >> you get the last word because we are right up against the time. so it must be a brief last words so we have not unilaterally

disarm the weapons to kind of begin this and it will mark a milestone in this range. so at the end of the day, in the same way that we came very close to a nuclear holocaust in 1963. ..

thank you for coming. [applause]

>> watch nbc's coverage of president kennedy's state funeral. >> and now to london for prime minister's question time live

from the british house of commons. every wednesday while parliament is in session, prime minister david cameron takes questions from members of the house of commons. prior to question time the house is wrapping up other business. this is live coverage on c-spa c-span2. >> that's one of the reasons why the company is investing. >> order. questions to the prime minister. >> number one, mr. speaker. >> prime minister. >> thank you, mr. speaker. this morning i had meetings with ministerial colleagues and others, and in addition to my duties in this house, i shall have further such meetings later today. >> thank you, mr. speaker.

this week launched cross quality camping with the support of the union. victims of blacklisting. we've written to all the companies involved and will read post the responses on a website. will the prime minister join me in this campaign to support hard-working people and stamp out the terrible disease of blacklisting? >> i'm very glad to join my honorable friend and i congratulate him on the work that he's done on this issue. blacklisting is illegal. blacklisting is wrong. this sort of intimidation is wrong. just as intimidation of nonstriking workers or indeed managers is also run. i'm happy to condemn both forms of intimidation and i hope others will as well. >> ed miliband. [shouting]

>> mr. speaker -- mr. speaker, following his u-turn on payday lending can ask the prime minister why he's moved into short months from believing that intervening in broken market is living and i quote in a market universe to be living it is a full on duty of government? >> as i said there are some dreadful practices that take place in the payday lending market. there are some very disturbing cases, and, frankly, for 13 years they did absolutely nothing about it. i'm proud of the fact that we have intervened to regulate this market properly, and we're also going to be putting in place a cap. that let me be very fair to the right honorable gentleman. i followed very carefully his interview on tv and i think it's fair to say he's no longer a follower. [inaudible]

>> ed miliband? [laughter] >> now, what's surprising, what's surprising, what's surprising is the chancellor said just a few weeks ago and i quote, the attempt to fix crisis crush endeavor and blunt aspiration. now, can he just reassure us that his u-turn had nothing to do with the prospect of losing a vote in parliament the following day? >> sorry, i don't think that's a very good start to these exchanges. i've done a little bit of research, mr. speaker. and in three years he has never asked me a question about payday lending. i've been asked about all sorts of things. it is right to intervene when

markets are not working and people are getting hurt. that is what we are doing. 13 years they had, they look to the cap in 2004 and they rejected it. that was when he was working in the treasury. we've looked at a cap, we've looked at the evidence from australia, from florida and elsewhere. it's the right thing to do and i'm proud we are doing it. >> ed miliband. >> mr. speaker, even by his standards, it's a bit rich. on the 22nd of may, 2012, they voted against capping payday lenders. on the fourth of july, 2011, they voted against capping pay delivers and on the 30th of work, 2011, they vote against capping payday lenders. we were for it. they were against it. clearly, he wants to claim, clearly he wants to claim the principal decision. but can the prime minister explained by the government intervening to cap the cost of credit is right, but the

government capping energy bills is communism? >> i feel like one of those radio hosts were you got to take -- and your complaint is exactly, call a? we're taking action when they didn't. we are doing the right thing. he should be standing up and congratulating us. he wants to turn, he wants to turn the energy. let me turn specifically to energy. the point is we don't have control of the international price of gas. so what we need to do is have more competition to get profits down and roll back the cost of regulation to get the prices down. that is a proper energy policy. and when it comes -- we know his version of intervention. it's take money off the co-op and don't ask any questions. [shouting] >> ed miliband. >> mr. speaker, mr. speaker, here is the reality.

[shouting] here is the reality. this is not a minor policy adjustments. it is an intellectual collapse of their position. [shouting] because for two months, because for two months they have been saying that if you take action to intervene in markets, that it's back to the -- it's marxism, now they realize they are on the wrong side of public opinion. that is the reality. [shouting] now, on energy -- on energy, on energy he must realize -- >> order. we will get through question of time however long it takes. i appeal to members simply to call debt and think of the electorate to whom we are here to serve. very straightforward. ed miliband. >> they are shouting because they have no answer, mr. speaker. and he must realize the gravity of the situation when there are figures this week showing 31,000

deaths as a result of a cold winter were there's 10,000 out as a result of cold homes. can he explain how are things going to be better this winter than they were last? >> there will be this winter and it's vitally important issue. what to will be will the cold weather payment that we have doubled from the previous levels. they will be in place. the winter fuel payment will be in place. the warm homes discount that helps 2 million people in our country, that will be a place. the increase in the attention, that will be in place. every excess step in the winter is a tragedy and there was 13,100 last you. you might recall when he was energy secretar secretary theree 36,500. >> ed miliband. >> mr. speaker, i asked a very specific question, was how were things going to be better than this winter than last. the reality is the price is what be higher this winter than less.

the average household the british gas bill went up 123 pounds this week. it was also revealed that the profit of the energy companies are up 75% in the last year alone. why under his government is it acceptable for the british people to pay exorbitant prices to fund exorbitant profits? >> what is intellectual incoherence is not to address the fact that were 36,500 winter deaths when he was standing in as energy secretary, and that number was lower last year. what is intellectually incoherent is the promise of price freeze when you don't control the global price of gas. that is completely incoherent and they total cost. win were on the collapse of intellectual position, more borrowing, more taxing, exactly the things that got us into this mess in the first place and he remains committed to each and everyone. >> mr. speaker, i'll tell you

what the cost. at saying one thing before the election and another thing as prime minister. here's what the honorable member for richmond said about him. maybe you'll listen to this. it's a pm can catch the top something that is so central to his identity, he can drop anything. hashtag dream crap. that is this prime minister all over. the truth is, the truth is that any action he takes on the cost of living crisis is he is being dragged there kicking and screaming. on the cost of living crisis he's not a solution, he's the problem. nobody believes, nobody believes he or his cabinet have any sense of the pressures facing the people of britain. [shouting] spent i think everyone can see a, recognize a collapse when we see one. we saw one right now. isn't it interesting, the week

before the autumn statement and he can ask about the economy because it's growing. he can ask about the deficit because it's falling. he can ask about whether numbers in work because they are rising. people can see we have a long-term plan to turn our country around, and people can also see him sitting in his room desperate for bad news to pursue his own short-term political interest. [shouting] >> george freeman. >> mr. speaker, one in a man will be diagnosed with prostate cancer, the silent killer of middle-aged men. [inaudible] would the prime minister a great to meet with me to see what we can do to make the nhs adopt innovation more quickly? >> i think my honorable friend

raises a very important issue, where everyone wants to see more research and better outcomes in terms of prostate cancer. and i personally basin for that magnificent growth on his top lip? i have noticed a number of my colleagues suddenly resembling -- it's not something i have to say, have to say, mr. speaker, that i'm fully capable of myself so i'm jealous on that growth. but it is important, better diagnosis, better knowledge, better information are all vital to beat prostate cancer. >> the prime minister once said he wanted to see rising living standards for all, not just those in high finance. why then are real wages down while bank wages are up? >> it's because we're cutting taxes, disposable income went up last year. what we have done is lift the first 10,000 pounds that people are in out of tax altogether big

that is worth 700 pounds for every person who pays that tax. that is something you should be welcoming. in addition we have frozen the council tax, cut the petrol duty and help in all sorts of ways with families income. every single step of posed by the party opposite. >> sir richard owen. >> thank you, mr. speaker. the tip foundation provides uplifting support for people living with dementia, and for their carers. following his challenge on to mention last year, and head of the g8 summit that he will host in london next month, can my right honorable friend send a message to my constituents about his commitment to achieving real progress on dementia research and tear? >> i'm grateful to my honorable friend for raising this issue. i think for too long in our country people thought of dementia as a natural part of aging rather than what it is which is a disease that we should be fighting with all the energy that we are fighting hard disease and fighting cancer. so as part of the dementia

challenge what we dementia challenge what we've said we'll do is double research funding over the lifetime of this government from 26 million to over 66 million a year in 201415. we also wants to increase in diagnosis rates. i think his constituents will welcome those pledges and, obviously, to our chairmanship we can galvanize action around the world as well. >> for two years the people of scotland were promised that they would receive a detailed and cost advice white paper that would answer all the questions. instead they got documents -- seven. given the entire white paper based on the assumption that scotland would keep the pounds was not plan b. can the prime minister tells with a lack of plan b it causes the creation of the entire credibility of the white paper? >> i very much agree with the

honorable gentleman. we have been waiting a long time for this document. we thought it would answer every question and yet no answer on the currency, no answer on the issue of eu membership, no proper answers on nato. we were just left a huge set of questions. and, frankly, for scottish people also the prospect of a thousand pound bill as the price of separation. >> thank you, mr. speaker. [shouting] >> thank you, mr. speaker. we are celebrating a year of the new owners of the former site, and with the prime minister's commitment to 40 million pounds or small, medium sizes intent we now have 1400 jobs and 60 companies. with the prime minister agree with me that when the private sector needs a proactive government, we can replicate these successes around the

country? >> well, first of all, can i praise my honorable friend for the work that she put in. clearly it was a blow when fisa made their decision and i think many people thought that would be the end for that site in terms of jobs and investment because of the hard work she's put in and also my right honorable friend to visit secretary and the science minister have put in a huge amount of work. the enterprise zone is working well. it attracted over 20 high-tech companies. fiserv is now staying as well. i think it has been a success and shows that if you work together with the private sector you can get good results i say. >> thank you, mr. speaker. as the disability benefits consortium -- seven calling for immediate action to exempt disabled people from the bedroom tax. why on earth does he and his government refused to listen? >> obviously what we've done is exempted disabled people who need an extra room.

and it does i think come back to a basic issue of fairness. and the basic issu issues of fas is this. people in private sector resident accommodation to get housing benefit don't get a subsidy for spare rooms were as people in council houses to get a subsidy for spare rooms because i think it was right to in debt. it is right to end it together 1.8 million people in our country on housing waiting lists. >> thank you, mr. speaker. i wonder whether the prime minister set a chance to watch any of the fantastic world cup it's semi-finals? as the tournament has been a great success and surely rugby fans of the rugby union will come forward in 2015 with games in england and in wales to will you agree with me there's great interest in the game of rugby and presents a great opportunity for my constituency to attract visitors to the birthplace of the gain?

>> i think my honorable friend is right that it is the best possible advertisement for his down. i've done a public meeting in his high street and know what a woman interesting and great reception you can get in the town of rugby. it's hard to keep up with a moment with the quantity and quality of rugby union and rugby league games. i made the wager with the new zealand prime minister that i would wear kiwi cufflinks if they one in the rugby union match. i did so last week but fortunately nobody noticed. [laughter] >> mr. speaker, the prime minister as -- seven when it comes to debate -- [shouting] [inaudible]

>> of course there should be a debate, including televised debate. but this is a debate between people in scotland. this is not a debate between the leader of the conservative party or even the uk prime minister and the scottish first minister. it's a debate, rightly, between the leader of the no campaign and the leader of the yes campaign. they should fight it out on the facts and on the issues. and i know you want to find every sort of distraction possible because when it comes to the economy come when it comes to jobs, when it comes to europe, the argument are for staying together. [shouting] >> the future reference deal, you shouldn't be yapping at the prime minister like an overexcited puppy dog. you can do a lot better if you tried. [inaudible] with 40 million people being employed, and 825 new businesses

to be set up in the last two years. in preparation for small business in december with my right honorable friend join with me -- seven and all are secondary schools to prosper and inspire another generation of entrepreneurs a? >> i think my friend makes a very important point. about the new business of setting up in britain and we have 400,000 more businesses than three years ago. but the point she makes about encouraging businesses into schools to inspire young people about enterprise, about small business and about what that can evolve i think is really, really important and i would urge all to make the most a small business saturday but also in the visit they made to primary and second are schools to push the case for good business access and good business discussions. >> thank you, mr. speaker. for weeks ago i met a constituent, she's 55, a mom and married. for the last four years she has had problems with her memory and

on her 55th birthday she was diagnosed with early onset dementia. her family is devastated but she is an inspirational woman and she's fighting for better services for people in similar circumstances. with the prime minister usher at the g8 in london that there is a real push for increase in research and the quality of care and support and prevention as was the important search for a cure? >> i think the right honorable lady is right. there is no one single thing we have to do. the research budget needs to go up and it is but we also need to work with in the health and social care sectors to improve standards. but, frankly, we need to make our communities more dementia friendly and something all of us can do is actually to become a dementia friends, a simple relatively short test and a bit of learning about how to help people with dementia in our committees because it's not just within health and social service sector. it's when people are trying to go on a bus or access their bank account or go down to the post office, how they live their

lives is something we can all make a difference to. >> thank you, mr. speaker. last friday, on the border between gibraltar and spain "the guardian" seville opened one of our diplomatic pouches. this is a clear breach of our sovereignty, and i ask my right honorable friend the prime minister what further measures political and, indeed, any other measures we could take towards spain to stop this harassment of our people in gibraltar? >> first of all, my honorable friend is right to raise this because it is a breach of the principle of state community and the principles underlying the vienna convention on diplomatic relations. it's an extremely cities actions that took place. we asked the spanish efforts to investigate urgently and they have done the. we've received an explanation. we are reassured this will not happen again but let me be clear, we will always stand up for the rights of people in

gibraltar and for the sovereignty of gibraltar. >> earlier -- 7-seven -- [inaudible] what additional measures can he undertake to assure them they alleviate the problems of the people suffer in northern ireland? >> the cold weather payments are perhaps the key thing because they are triggered by low temperatures and a kick in at 25 pounds a week so that i think makes the biggest difference but i outlined all the things we're doing including the warm homes disco which the energy companies themselves are putting in place to help tackle fuel poverty. and on the measures of fuel poverty that existed under less government, fuel poverty is lower today than it was when the party opposite was in office. >> is my right honorable friend aware of the concern in sussex

about using a road toll to pay for improvements, and the consequent risk that introducing tolls on roads without a toll-free alternative may undermine support for the sensible concept of road pricing? >> i am well aware of the strong feelings in suffolk about this issue that it are approached by many members of parliament. i believe that road tolls can play an important part in providing new road capacity and it's important we find ways to pay for road capacity but i also understand the concerns about this individual case. >> does the prime minister realize they get something in common -- [inaudible] and yesterday the first minister applied -- [inaudible] what does the prime minister think about the millions who see rocketing fuel bills this winter?

>> getting to grips with energy bills means more competition in the market which we are delivering. we were left -- we see new companies coming in and people like the leader of the opposition deciding to switch their energy supply. a very good toward principle but we also need a robust the cost of some of the levees and we're looking at that as well. >> thank you, mr. speaker. the prime minister will be aware of that mps from rural areas across party lines have for many years campaign for a fair funding formula for schools. a building -- the issue has been brought to a head again and we've been led to expect new policy. and the prime minister usher pupils and teachers in rural schools that good news is on its way and they won't be disappointed? >> i do understand the concerns because the funding for most are built up over many years and there are places in the country

that you feel disadvantaged, particularly those in rural areas who can suffer exclusion and poverty and feel there isn't properly reflected in the funding phone bill. my friend the education sector continues to look at this and we will see what we can do. >> in my constituency as in many others, smes are the engine room of the economy. so why are business rights lacking but as nearly 2000 pounds in this parliament? >> i can tell what we have done on business raise. which is to extend, which is to extend a freeze on business rates of the last government was going to get rid of. why we are also doing a business rates is having a 2000-pound cut in national insurance for every business in the country. the smaller businesses up and down our high street i can't think of anything will make a bigger difference than seeing that bill go down by 2000 be able to employ more people.

while we're on the subject of how to help business, how on earth can it be a good idea to say that you want to increase corporation tax as you go into the next parliament? that seems to me absolutely mad in terms of a new labour jobs tax. >> thank you, mr. speaker. by the end of this year, over 8000 people in our country will been diagnosed with and create cancer. only 4% will even have the chance of a five year survival rate. these figures have not changed for the last 30 years. with primus to join with us in there and that it is time to change and improve on this dreadful outcome of? >> so my friend makes a good point and there is always an issue raised by those charities who are campaigning on some of the lesser well known and less prevalent cancers that they

don't get a fair share of the research funding. it is an issue i've taken up with health secretary and i think we need to make sure that we're starting research funding and the work we did into cancer fairly across the different disciplines and across the different cancers. >> can i repeat, energy companies are making, made 77% profit a customer in 2012. does the prime minister agree that this is unacceptable? and if so, what immediate steps is he proposing to take to protect customers from blatant profiteering? >> what we need to do is create a more competitive energy market. as i said we inherited the situation with just six big companies. we've seen seven new companies coming to the market, and the number of people with independent suppliers eyed the leader of the opposition, a

number of people has doubled during this parliament. so we are making progress, but i always follow what the honorable gentleman says because recently he gave an interview where he went on the radio about labour's policy, he said i don't know opposition on welfare, i don't know on education, i don't know opposition on how we run the health service. i think a question on that would be a good thing. [inaudible] what lessons has my friend learned from the failures of the last labour government, which despite claiming that 13,000 what arrived in the uk deliberately allow more than a million to come into our country? >> i think my honorable friend does raise an important point because of course there are benefits within the eu of free movement but there should be proper transition control. we increased the transition control on bulgaria and romania from five years to seven years when we begin the government but

it still baffling to me why the last labour government in 2004 decide to have no transitional controls at all. they predicted 14,000 oldest people would arrive to work in britain and the event the number was over 700,000. it was a shameful dereliction of duty. >> does prime minister -- the prime minister will be aware -- [inaudible] on the london underground network with over 700 jobs to be lost. does the prime minister agree that is the way to raise living standards? >> the best way to help londoners is to make sure we have a safe and affordable to an that we use modern technology in order to deliver the. i think the conversation the honorable lady needs to have is with the trade union that have been so much damage to our

underground, and we ought to be having on her underground no strike gives and permanent systems that provide a good service. >> mr. speaker, earlier this week in brighton i was tested for hiv. this sunday is world aids day. with the prime minister a great that envy of the fact in this country one in five people with hiv don't know they have it, regular testing is to be encouraged? >> i pay tribute to my honorable friend and to all honorable friends around this house and in politics who campaigned so consistently on this issue. it's a vitally important that we approve the lie lives of people with hiv and aids here in the uk but it's also vital we go on working internationally including to our aid budget to tackle hiv and aids around the world and they think we can be proud of the money that we put into things like the global fund and the fact that in this country we've achieved north of

7% were many other countries have broken their promise. .. >> thank you, mr. speaker. a number of friendships have doubled since 2010, helping create a stronger economy and a fairer society. delegation of young people to see how we can serve the

framework year. >> i am delighted about the number of apprenticeships and a major financial commitment from the government. it is making a real difference but we have partner to go in terms of cackling this, between the ages of 16-24, always happy to meet with people. >> mr. speaker, house prices are going up at a time real wages are going down. does the prime minister accept when interest rates go up after the election, this will detonate a sub prime debt crisis? >> the greatest danger is interest rates. that is what that read family in this country should address. >> order. >> here on c-span2 we will leave

the british house of commons as they move to other legislative business. you have been watching prime minister's question time heir lives at 7:00 eastern when parliament is in session. you can see this again sunday night at 9:00 eastern and pacific on c-span. for more information go to c-span.org and click on c-span series for prime minister's questions plus links to international news media and legislature are wrong the world. you can watch recent video including programs dealing with other international issues. >> coming up on c-span2 a look at the challenges facing the u.s. military. attorney-general eric holder said earlier this month he is concerned about the threat from the so-called loan wolf terrorist attack. that is later.

>> the 60s were different. there were a lot of things happening involving race, the breakdown in the structure of society, i was out of the seminary and in new england. there were no rules. things were falling apart. without structure, it is difficult to navigate. i was extremely fortunate, to still have had a residual -- the way i was raised, the structure that was given me, the structure the seminary had given me. i was extremely fortunate because i had already been in predominately white schools, i was the only black kid in my high school in savannah. the transition to a school with very few blacks and in a very

difficult circumstance academically and otherwise, i had sort of a jump-start. i was the head of the game so i had something. allowed me to continue to do well even though it is very difficult. >> thanksgiving on c-span hear from two supreme court justices, clarence thomas at 9:00 p.m. followed by elena kagan at 9:45 eastern. also this holiday weekend four days of booktv on c-span2 including debra sullivan on the life and art of norman rockwell. thursday at 9:30 and on c-span3's american history tv the 150th anniversary of the gettysburg address. james mcpherson commemorated the ten sentences president lincoln spokane dedication of soldiers national cemetery at gettysburg 4:00 and 10:00 p.m.. >> up next conversation on u.s. defense policy. topics include the recent nuclear deal with iran, but negotiations in congress and the

upcoming u.s. withdrawal from afghanistan. from the aspen institute this is an hour and 20 minutes. >> thank you for coming. i am sorry i am not nick but here i am. let me pull myself together. i will briefly introduce michele fluornoy and philip, we were in aspen and i see a number of people in the audience to work in considerably better weather last summer. michele fluornoy is the senior adviser at the boston consulting group from 2009-2012, undersecretary of defense for policy, and principal adviser to the secretary of defense in the formulation of national security and defense policy and military plans and operations and so forth. i interviewed her on number of times. she was very conscious, she knew she knew a lot but never told us

very much. she is a senior fellow at harvard for science, international affairs, member of the policy board, she co-founded the center for new american securities, the think tank you all know. she is the member of the aspen strategy group. philip zelikow is the professor of history at the university of virginia, the dean leading the graduate school of arts and sciences. he started as a child getting into arguments. i love that. i will put that in my resume. i like that. soon after he became a trial and appellate lawyer in texas doing criminal justice and civil rights work. there is so much more peer. he was an adviser to secretary of state condoleezza rice. when i first met him, the department of state, member of the president's intelligence

advisory board, worked for president bush and president obama. he has written a number of books, germany unified in europe transformed. i did read that one. he is a member of the aspen strategy group. i will ask a few questions and open it up to the audience. we are in a transitional period for american defense strategy. are there questions? a building down we talked about of the pentagon. are there lessons in earlier periods in american history that could guide us now? i guess i should -- why don't you both answer that question. >> good afternoon. it is wonderful to see so many familiar faces around the table.

i do think there are some lessons to be learned from our history in terms of periods like this where we are coming out of a period of war a decade more than a decade of war and we are facing very severe budget pressures on this type of budget. there are two lessons that come to mind. the first is a strategic lesson and when america comes out of the period of war we typically are very tempted to turn inward, allow the isolationist impulse collapse that have come and gone throughout our history to assert themselves quite powerful. when on lookout at the world with fundamental changes happening with new powers rising, changes in the balance of power in key regions from asia to the middle east, turmoil in the middle east, continued

challenges of terrorism, proliferation, all kinds of challenges, the mellon -- volatile environment. and a set of problems for which it is difficult to imagine solutions without someone catalyzing an international response. toomey weekend lose sight of the fact that we are a global power with global interests, american security depends on staying engage in the world and shaking events that happened far from our shores. we also have a unique role to play on catalyzing action to deal with challenges. we have to resist it contagion to turn away from the world and get economic house in order and

put show domestic agenda forward the we have to secure our place in the world. as we come out of wars in the past typically the defense budget goes through a drawdown and we try to balance too much of the ballot on the back of the force. we cut readiness and modernization disproportionately. we end up with a force that looks good on paper but does not have the capability it needs in practice. as i look at this period we are in now are particularly with the straitjacket of sequestration and the inflexibility of these across the board mandated cuts i am very worried that we are about to repeat that mistake of hollowing out the force because we are not able to manage the draw down in a smart way that we should. in my view we need to be putting

much more emphasis on pooling resources out of an inefficient and too large defense enterprise and to try to maintain and protect readiness and modernization for the future where we can. >> my paper begins with a paragraph, i did like to go over with some carapace. it is very historically oriented. i start with a set of four assertions all of which are paradoxes. the first assertion is despite constant headlines about troubles in the world, the country is remarkably safe and secure at the moment. assertion number 2. but american levels of defense spending are nonetheless still at near historic highs, measured

in constant dollars and various ways i get into in the paper. even accounting for projected cuts including the level of spending and vision by sequestration putting aside the method by which the cuts are affected, yet feared, these expenditures are fully allocated and the inefficiency is likely to get much worse, inefficiency in the sense of expenditures that are actually not relevant to producing effects that change or affect material conditions we care most about in the world. fourth, high spending in a period of low threat is buying wes and less meaningful defense for situations not so far in the future that could be more threatening than they are right

now. i call attention in the paper, offer a theory of entropy in defense. entropy, a term borrowed from classical mechanics having to do with the degenerating amount of energy being put to useful effect. part of the argument is larger and larger parts of the defense budget are devoted to things that are not related very much to national defense. national defence are all over the talking points used to defend the programs any number of occasions. so actually you saw this right after 9/11 where actually throughout the 1990s the defense is establishment has become less and less relevant to the way the world was changing and after 9/11 huge adjustments had to be made. these were mostly bolted on top with marginal additional increases in spending across of

the big fix. in order to develop new capabilities for basically strapped in an ad hoc way onto the old established capabilities that now have in turn become part of the fixed base. and are now being cuts in these odd and inefficient ways that michele fluornoy decries. so you have this phenomenon of entropy that i get into in the paper but also make a conceptual argument about how one could reorient defense strategy along the lines of fast requirements and slow requirements and our whole defense posture is oriented almost the exact opposite from the way it should be oriented. fast requirements call for hy readiness forces ready for extremely high tempo operations, exhaustingly high tempo, round-the-clock, 24-hour hyperintense operations that will pass their decisive moment in the first day to come.

it won't be over but it will pass the decisive phase in the first days. the forces that need to be relevant to that conflict need to be fairly close entirely ready. their size may not be extremely great. search slow conflict scenarios for which you can use forces that can be made available slowly, for instance many of the sorts of simmering transnational conflicts in which america might offer advice in systems in different ways and from those observations i offer a number of suggestions, some of them pretty radical that idealize possible force structures. there are abundant history lessons. one of them was also described in the paper mill loeffler wrote for this aspen strategy group session which will be in the group.

some of the most fertile and creative periods in american defense planning and strategic adjustment occurred during periods of cuts and retrenchment. among the most fertile decades in the history of the american armed forces were the 1920s, not the 1930s, not the interwar period as a whole but the 1920s. they were not especially fertile or creative for the american army but were highly important and creative for the navy, the marine corps and the embryonic air corps. another critical period is the late 1940s and 50s, the period of the eisenhower administration which actually was dominated very much in eisenhower's view by the need to make cuts and retrenchment after is centrally and limited spending that seemed to have been unleashed by the outbreak of the korean war in 1950 and eisenhower spent much of the balance of the 1950s trying to restrain the defense budget and for strategic forces

which resulted in the development of the cold war defense posture that dominated the subsequent decades. in contrast to the era of the 20s or the late 50s 1990s are described in my paper having been a decade the locusts have beaten. in which significant adjustments were not made, and indeed the kind of military . in which significant adjustments were not made, and indeed the kind of military industrial complex eisenhower warned about in 1961 began to prove its strength and traction. they endured very well indeed. the era of war we had in the 2,000s did not so much really reorient a lot of the foundational parts of the defense establishment but instead crafted new pieces on top of them that we are uneasily

reckoning with known as that phase in our history seems to be coming to close and the new chapter is beginning. >> thank you. i am going to move ahead because are you confident that the obama administration and congress can agree on defense cuts that do not impair significantly the ability of the united states to remain the world's dominant superpower? >> not. i think that person outline of a small budget deal when you talk to reasonable members of both parties in congress and there are still some who belong in that category. you can come up with some

mechanisms for increasing revenue and some mechanisms for restraining, reducing, that could at least get us to a small budget deal for the next two to three years with some relief for to avoid another round of sequestration and so forth. whether we can see our way through the political process to get there is another question altogether. i think i am by nature an optimist. i want to believe rationality will prevail but so far it hasn't. time after time, from the imposition of sequestration to the recent shutdown and so forth. so i am not confident at this point, but the conversation we need to be having is one of raising public awareness of some

of the very real costs of sequestration on national defense. i agree with philip that there is a lot that we could extract from the defense budget and reorient and spent in better ways but sequestration doesn't allow you to make cuts in a smart man. it forces you to cut the highest priorities along with the lowest priorities. to me we have got to help people understand the damage to readiness that is already taking place, the ways in which we are breaking modernization programs that will be fundamental to safeguarding american military superiority and ability to prevail in the future, we have to raise public awareness and congressional awareness. the old caucus in congress that used to hold together on national security issues is no longer so we have to start from

scratch to have this conversation and try to build support for a larger deal not only on our own domestic economic roots but also national security grounds. >> i agree with michele. no one is going to lose money betting against executive congressional cooperation. let's just think a little bit about suppose you thought it could possibly be fixed. the basic processes conspire to make it difficult to fix the way we do strategy now. one reason it worked in the cold war is a broad degree of consensus over relatively stable objectives we were working toward a new have lots of arguments in the margins. that stable consensus about what we are trying to do in national defense is pretty badly broken. without a clear vision to

replace it, naturally everyone just basically defends there can't. how are defense strategies devised now? they are devised from the bottom up in the pentagon and the congress in a sense. in the pentagon, requirements are generated through a process that michele understands better than i do and i have tried. i will tell you by the time the process would reach the level of michele it is not fully baked but is pretty substantially baked. it is not impossible for a gifted bureaucrat at michele's little to intervene to move the process but it is challenging because at that point an awful lot of bargains have been struck, a lot of things have been put in place and it gets hard even within the pentagon leadership to reorient the posture. meanwhile in the congress apparel process is happening that originates in congressional

districts with constituents and constituent enterprises and works its way through individual congressmen. at the top level we decry an absence of leadership. suppose they want to exert leadership. i want you to see among the most highly motivated congressmen and secretaries of defense the system makes it difficult to make agile strategic moves for reorientation. it is not impossible to beat this. if you have very high degree of clearance -- clarity at the top shared by key congressional leaders brought in in a deep way in strategic contemplations which perhaps occurred in recent years but i have not seen it, where you are bringing in key committee chairs in to the formative stage of national defense strategy and then working back from that consensus

backwards to drive your respective processes, maybe there is a chance. if you conclude there is not a chance, entropy will win and strategic adjustment will only occur by adding further marginal spending on the top and we will be inevitably frustrated how much we have to spend for so little apparent effect. >> i don't disagree with the notion that there is bureaucratic inertia that drives how the department of defense defines its requirements and even its sense of strategy. i have seen occasions when top-down leadership and intervention has really shifted the course and we saw that with the development of strategic guidance in 2012, where once the congress passed the budget

control act of 2011 which the $487 billion out of the defense department for the next ten years we have a fundamentally new resource constraint, rather evangelist asking people who write strategy in the department to go try to figure this out, the president actually said this requires fundamental rethinking and we need to do this as a group of leaders and so he asked the secretary, the chairman, the chief, service secretaries, content commanders to come spend three multiple our meetings in the cabinet room as a group, check your parochial hat at the door to the extent that that is possible but really engaged with the leadership in an active way to redraft the strategy and that strategy was helped to articulate the rebalance towards

asia, continued emphasis on protecting our interest in the middle east, talked-about taking a risk in areas of prolonged counterinsurgency that we will reduce our ground forces coming out of two wars. emphasizing partner engagement, protecting investment in critical areas from cyber to intelligence surveillance, reconnaissance to special operations forces, robotic systems, there is up whole range of priorities that came out of the exercise and was talk down driven and that became the bible for the next round of the budget enterprise and more than any other strategy to budget exercise i have seen and i have the scars to show i have been through many t d rs and such. that strategy, strategic guidance actually drove the budget. maybe that is the exception that

proved the rule but it is possible, what i didn't see was in depth engagement of congressional leadership that you talked-about which i do agree is necessary to rebuild bipartisan consensus about where we are trying to go with defense. >> i share michele's positive remarks about the defense strategic guidance though i played no hand in crafting it. i think in many ways is an admirable document also in some ways you can use it as a benchmark against which you can assess the actual changes that are apparent in the force posture of the united states and the relevance of x billions of dollars against objectives positive and the defense strategic guidance and form an estimate of a parent entropy. >> let me move on to some news i

want to ask you about the iran deal. it is hard to imagine at this the department what happened >> the origins of it did happen. i mean that seriously. the origin of this move were in spring of 2006. >> that is true. >> remember, which was hotly criticized by many of the same people participating in today's debate it is worth keeping this in mind to strike a bipartisan note appropriate for the setting of the aspen institute. in spring of 2006 the big move was united states offered to initiate with no preconditions, negotiations with the islamic republic of iran even while iranian operatives were killing americans in iraq and so forth. they did that in the p 5 plus

one process. because of that move which the iranians substantially spurned the united states was then able to give foundational u.n. security council resolutions that have been the premise for everything in the last seven years. resolutions which at the beginning of 2006 everyone told us we could not get. and then the building framework for the global coalition that by the way is an astonishing bipartisan diplomatic achievement. carried forward with great effect by the obama administration includes the stuart levy treasury and other officials at treasury, including the global coalition that crippled the iranian economy and the geopolitical significance of the coalition and the fed coalition created and has endured for seven years to reach the present moment, that is an extraordinary bipartisan accomplishment that has